GKFX – Gold prices edged higher for the third consecutive session on Thursday and built on its goodish rebound from over one-week lows, set on Monday.
A combination of supporting factors helped the precious metal to reverse an early dip to $1191 area and continue gaining positive traction through the early European session.
The global flight to safety, triggered by the ongoing rout in equity markets, underpinned the commodity’s safe-haven demand. The risk-off mood was further reinforced by a steep fall in the US Treasury bond yields, which further benefited the non-yielding yellow metal.
Gold Prices Edges Higher to $1200
Adding to this, the US Dollar retreated farther from seven-week tops and provided an additional boost to the dollar-denominated commodity, lifting it to three-day tops and back closer to the key $1200 psychological mark.
It, however, remains to be seen if the positive momentum is sustainable or is once again utilized as an opportunity to sell at higher levels. Market participants now look forward to the latest US consumer inflation figures, which might influence Fed rate hike expectations and eventually provide some fresh directional impetus.
Technical Levels to Watch
Any subsequent up-move beyond the $1200 mark is likely to confront resistance near the $1203-04 region, above which the momentum could further get extended towards $1209-10 supply zone.
On the flip side, the $1191 area now seems to have emerged as an immediate strong support and is followed by $1187 horizontal zone, which if broken might accelerate the slide further towards $1183-82 support area.
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